Sunday, September 22, 2019

Good News?

Year-on-year weekly earnings growth increased to 4% to generate the fastest increases in real incomes for 10 years. Good news?

Private sector pay growth has improved in the last couple of years. However, the jump to 4% can be found in the loosening of pay restraint in the public sector. It’s not by much, as any teacher or nurse will report, but it is enough to lessen the public sector’s drag on the average figure for wages growth.

Last week, the New Economics Foundation calculated that the average worker was still £128 a year worse off than in 2008 once VAT rises in 2010 and 2011 were taken into account, among other costs that hit real terms earnings.

A previous analysis from the Institute for Fiscal Studies thinktank, said annual wages were £760 lower last year than they were a decade ago.

Full-time work has also risen, though as a proportion of jobs growth it has lessened as self-employment has returned. Good news?

But we need to look at who has grabbed the bulk of the full-time roles created in recent years. Without a doubt the bulk have been taken by older people. They are men aged between 55 and 70 and women in their early sixties who have been forced to carry on working after former chancellor George Osborne increased their state retirement age to 66 at an accelerated rate.

Of the 3.4m jobs created over the last 10 years, says the Institute for Employment Studies, 2.5m have been professional or senior jobs, 500,000 are classified as low skilled and just 400,000 sit in the middle as skilled and semi-skilled workers.

Young people simply cannot jump into professional and senior roles. They are hoovered up by older workers who, it stands to reason, fit the bill.
Then you look at where jobs are being created and it is no surprise to find most are in London and the south-east.

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